Quick Facts
FONT-SIZE Plus   Neg
Share SHARE

THQ Files For Chapter 11 Bankruptcy; Stock Plunges - Quick Facts

THQ Inc. (THQI: Quote) announced Wednesday that the company and its domestic business units have filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Court for the District of Delaware. The company said that its foreign operations, including Canada, are not included in the filings. The company said it has obtained commitments from Wells Fargo and Clearlake for debtor-in possession or DIP financing of approximately $37.5 million, subject to Court approval.

The company also announced that it entered into an Asset Purchase Agreement with a "stalking horse bidder," affiliates of Clearlake Capital Group, L.P., to acquire substantially all of the assets of THQ's operating business, including THQ's four owned studios and games in development.

The company said that the sale will allow it to shed certain legacy obligations and emerge with the strong financial backing of a new owner with substantial experience in software and technology.

The company added that it will continue operating its business without interruption during the sale period, subject to Court approval of THQ's first-day motions. All of the company's studios remain open, and all development teams continue. As part of the sale, the company is seeking approval to assume the contracts of these studios, and Clearlake will assume these contracts.

Clearlake has agreed to serve as the "stalking horse bidder" for a Section 363 sale process, which allows other interested parties to come forward with competing bids. Aggregate consideration offered by Clearlake for the purchase totals approximately $60 million, including a new $10 million note for the benefit of the company's creditors. The company is asking the Court for a schedule to complete the sale process in about 30 days.

The company noted that the new financing will support business operations throughout the period. THQ does not intend to reduce its workforce as a result of the filing, and employees will continue to work their usual schedules and receive normal compensation and benefits, pending customary Court approval.

THQI is currently trading at $0.51, down $0.87 or 63.04%.

Register
To receive FREE breaking news email alerts for THQ Incorporated and others in your portfolio

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
Social networking giant Facebook, Inc. said Wednesday after the markets closed that its second quarter profit more than doubled from last year, as revenue surged 61% amid strong growth in mobile advertising. The company's quarterly earnings per share, excluding items, also came in above analysts' expectations as did its quarterly revenue. With traders reacting to the latest batch of earnings news, stocks fluctuated over the course of the trading day on Wednesday before eventually ending the session mixed. The Dow ended the day in the red, but the broader Nasdaq and S&P 500 managed to close in positive territory. House Republicans revealed a series of recommendations to address the crisis along the U.S.-Mexico border on Wednesday, although party differences may prevent a final bill from being passed before the August recess.
comments powered by Disqus
FREE Newsletters, Analysis & Alerts

 

Stay informed with our FREE daily Newsletters and real-time breaking News Alerts. Sign up to receive the latest information on business news, health, technology, biotech, market analysis, currency trading and more.